Cathay launches mid-cap China A-share ETF in Taiwan

Aug 7th, 2018 | By | Category: Equities

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Cathay Securities, a division of Cathay Financial Holdings, has launched the Cathay FTSE China A150 ETF (00743 TT) on Taiwan Stock Exchange.

Taiwan Cathay Securities

As of 3 August 2018, there are 110 ETFs listed on Taiwan Stock Exchange.

The fund tracks the FTSE China A150 Index offering exposure to mid-cap China A-share stocks.

The index is made up of the 150 companies outside the top 50 in the FTSE China A 200 Index of Chinese A-share companies.

A-shares are renminbi-denominated stocks of Chinese firms listed in mainland China on either the Shanghai or Shenzhen stock exchanges.

The index is weighted by market capitalization with reconstitution and rebalancing occurring on a quarterly schedule.

According to Cathay Securities, the FTSE China A150 Index is powered by strong new industries such as consumer products, medical insurance, and technology companies.

In terms of portfolio composition, the largest sector weightings are Industrial Goods & Services (19.5%), Financial Services (12.2%) and Health Care (11.2%). Banks, by far largest sector in the FTSE China A50 (33.0%) and FTSE China A 200 (22.3%) indices, has just 3.9%.

The largest companies are Haitong Securities, Kangmei Pharmaceutical, China International Travel Service, Yunnan Baiyao Group and Qingdao Haier. The index has an average market cap of $2.8bn compared to $14.4bn and $5.8bn for the A50 and A200 indices respectively.

The fund trades in Taiwan dollars and comes with a management fee of 0.90%.

Cathay Securities also offers the Cathay FTSE China A50 ETF (00636 TT) for investors who wish to include exposure to mega-cap. This ETF has a management fee of 0.95%.

The new launch brings the total number of ETFs listed on Taiwan Stock Exchange to 110.

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